Business
Credit insurance withdrawal threatens pack SMEsJosh Brooks, 11 December 2008Be the first to comment on this article Credit insurers are understood to be withdrawing credit insurers from packaging companies, forcing them to pay upfront for supplies and putting their businesses at risk. A number of firms have contacted Packaging News to report the problem, which is a result of the credit crunch, saying that their cashflows are coming under pressure because of the issue. One managing director of an East Anglian packaging firm, who did not wish to be named, told Packaging News that his firm could no longer get credit because of the withdrawal of its insurance. He said: “If a corporation has a policy of only supplying companies that can be credit insured, then you’re in trouble.” Another source at a packaging SME said: We don’t have a policy of hoarding cash – I don’t know many people who do – so losing your credit insurance is making life tough. The sources were speaking after business secretary Lord Mandelson launched a new code on payment practices for small businesses that aims to ensure major buyers pay their suppliers on time. However, the East Anglian packager said: Our problem is not being paid on time – there are still honourable traders out there. The problem for us is paying our suppliers and without credit, it’s very difficult to do that. Packaging News wants to cover this issue further in our January magazine. If you are having trouble with credit insurance, contact editor Josh Brooks at josh.brooks@haymarket.com Speak Your Mind |
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